BG&E sues state for $1.9 million bill

January 28, 1994|By John W. Frece | John W. Frece,Staff Writer

A week after Gov. William Donald Schaefer twice curtailed state government operations to help avert a widespread power outage, Baltimore Gas and Electric Co. has sued the state to collect a delinquent electric bill.

In papers filed Tuesday in Baltimore County Circuit Court, BG&E demands nearly $1.9 million for electricity consumed at the state's Preston Street office complex between 1987 and 1992, $64,000 in late charges, plus an unspecified amount of interest and court costs.

The state acknowledges using the electricity but disputes responsibility for bypassing a BG&E meter with a major electrical feeder cable. Repairmen discovered the bypassed meter during a power outage at the complex in August 1992.

The utility had been willing to settle the dispute if the state agreed to pay half the bill, according to a Dec. 1, 1993, letter from BG&E to the state obtained by The Sun.

State officials said BG&E and the state were negotiating as recently as last week, that the governor had put $400,000 in this year's budget to pay part of the delinquent bill and that additional payments had been possible later this legislative session.

Page W. Boinest, the governor's press secretary, said Mr. Schaefer was "philosophical" about the suit, saying he understood it was filed for business reasons. But she said the filing could jeopardize any payments by the state this year.

"It is distressing to see a lawsuit one week after the governor and the state of Maryland bent over backwards to help out BG&E when they were concerned about meeting their customers' energy demands due to cold weather," she said.

Mr. Schaefer shortened the state workday twice last week after receiving a telephone plea from BG&E Chairman and chief executive officer Christian N. Poindexter.

BG&E spokesman Arthur J. Slusark said the suit was filed "in the best interests of both our customers and our shareholders."

He said the suit and last week's energy crisis are unrelated issues.

The lawsuit, which alleges breach of contract, negligence and gross negligence, says the state has "refused to pay, despite repeated demands."

The lawsuit contends that the state and its electric subcontractor, Enterprise Electric Co. of Virginia Inc., "should have known not to physically bypass a labeled BG&E metering cubicle, but [did] so willfully, wantonly and/or with reckless disregard of the fact that by installing devices which were expressly designed to bypass BG&E's metering equipment, the state would receive the direct benefit of electric services which BG&E would not be able to measure and bill to the state."

Dave Humphrey, a General Services' spokesman, insisted that only BG&E had access to the mechanical room in the Preston Street complex where the unmetered cable was located.

N. Frederick Churchman, secretary-treasurer and part owner of Enterprise Electric Co. Inc. of Baltimore, said he knew nothing of the suit or the dispute. He said a predecessor company, Enterprise Electric Co. of Virginia, was disbanded in 1988 and that the company's resident agent cited in the lawsuit has been dead for a decade.

When told of the allegations, however, he called them "ridiculous."

"It's a cardinal rule that you never, ever, ever touch BG&E equipment. You just never do that," he said.

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